Many small business owners do not know that in the first 18 months, a whopping 80 percent of the United Kingdom, Firms fail. Bad financial management is usually one of the key triggers. In spite of these dire implications, when it comes to managing their assets, many business owners go it alone. A new study showed that 53% of small business owners do not at all use an accountant. And even more surprisingly, 27% of these respondents are actually using pen and paper to keep track of their finances.
Although we can not say that these firms are worse off for not having accountants in London, the depth of expertise and experience that an accountant can have should not be overlooked. Many people at home do not service their vehicles. Instead, they bring them to a skilled mechanic who can keep things running smoothly and detect possible problems. Just the same attention from Accountants is required by small businesses.
Accountants do more than file taxes. To keep your company in a stable, productive state, they will take a detailed evaluation of your finances and produce a forecast for the year. Especially if you have had difficulty handling your finances in the past, it can seem overwhelming to let an outsider in on the intimate details of how your company is run. In reality, however, working with an accountant will help you achieve your objectives and set you up for long-term success.
Here are 3 reasons why it’s critical for your organisation to have an accountant.
1- Avoid an audit
To avoid the dreaded audit is a really compelling reason to recruit an accountant. Unfortunately, once these difficulties have arisen, most individuals think of an accountant as someone who can solve them. The main thing to note is that if you have an accountant’s guidance and recommendations all year round, an audit will easily be prevented.
There are a lot of explanations as to why a company is audited: from too many tax form errors, to being too ‘charitable,’ to excessive write-offs. As a long-term partner, think of an accountant who is invested in your business and cares to keep it fiscal sound.
2- Get all your deductions
Most business owners are frantically thinking during this busy tax season about how they can maximise their deductions. It is too late to make an impact on that by the end of the year, though.
By easily identifying these potential deductions throughout the year, an accountant can support you and advise you on how to make strategic decisions for year-end deductions. Many company owners fail to track things such as depreciation, out-of-pocket expenditures and home office space and account for them. Don’t leave a table with money!
3- Make real-time decisions
They always tell me when I meet business owners that they wish they could easily quantify the possible implications and consequences of making a major office purchase or recruiting more employees. Getting an accountant as your financial advisor to assist you on a steady basis with budgeting and tracking cash flow would help you to navigate any real-time obstacles.
Through your accountant, you can take a collaborative approach, helping you to make decisions based on the latest data together and also take advantage of a consultative relationship that will help you make strategic choices when you need to make them.